SEC 2022 Examination Priorities

SEC-Division-of-Examinations-Announces-2022-Examination-Priorities-540x360

The SEC’s increased emphasis on cybersecurity continues to merit attention as it enhances the focus on Private Funds, ESG, and Operational Resiliency.

Key Takeaways:

  • Most notably, from a CYBERSECURITY PERSPECTIVE, the SEC is focused on Information Security and Operational Resilience as it relates to broker-dealers’, RIAs’, and other registrants’ practices to prevent interruptions to mission-critical services and to protect investor information, records, and assets.
  • For Information Security and Operational Resiliency, the Division will review broker-dealers’, RIAs’, and other registrants’ practices to prevent interruptions to mission-critical services and to protect investor information, records, and assets.
  • Examinations will continue to review whether firms have taken appropriate measures to:
    • Safeguard customer accounts and prevent account intrusions
    • Oversee vendors and service providers
    • Address malicious email activities, such as phishing or account intrusions
    • Respond to incidents, including those related to ransomware attacks, identify and detect red flags related to identity theft, and manage operational risk as a result of a dispersed workforce
  • In addition, the Division will again be reviewing registrants’ business continuity and disaster recovery plans, with a particular focus on the impact of climate risk and substantial disruptions to normal business operations.

Why it Matters:

  • The priorities are based on a risk-based approach that includes an analysis of a given entity’s history, operations, services, products offered, and other risk factors to ensure there are guard rails in place to prevent past mistakes.
  • The list is compiled by staff who are uniquely positioned to examine practices, products, services, and other factors that may pose risks to investors or the financial markets.

Resources:

For more information on how BW Cyber can assist you, please contact us at info@bwcyberservices.com.